Company News in Brief

Dis-Chem flags slower sales growth, but some positive trends as wellPharmacy group Dis-Chem, SA's largest by dispensary market share, reported on Friday it saw a slowdown in revenue growth in the first four months of its second half, but some healthy trends as well. Group revenue rose 7.2% in the four months to end January, it said in a trading update, with retail revenue growing by 5.6% and external wholesale revenue by 18.8%.In its six months to end August, the group had reported group revenue growth of 9.6% — and operating profit growth of 17.5% — while its retail revenue had risen 7.1%.But the group said it did see a retail recovery in January, which has continued in February, driven by the availability of medical aid benefits. This helped counter weak November trade.Valued at about R28.5 billion on the JSE, Dis-Chem operates 333 retail stores — up by six from the end of August — including 286 Dis-Chem Pharmacy stores and 47 Dis-Chem Baby City stores. It has been pushing a strategy of expansion while keeping personnel costs low through measures such as transfers."The pleasing work done in managing retail employment cost, the group's largest expense, continued," CEO Rui Marais said in the statement. "These incremental improvements continue to contribute to positive operating leverage and the delivery of earnings growth seen in the first half of the year".Like-for-like retail revenue grew 2.9% during the four months, down from 4.8% in the six months. But the group's franchise pharmacy brand, The Local Choice, continued to perform well, seeing revenue growth of 19.5% — but down from 21.8% in its half-year.TLC offers independent pharmacies a support network — and the group now has 230 TLC franchise stores, up from 200 at the end of August.Dis-Chem said grew its dispensary market share and retained its status as the biggest dispensary group in SA, but in morning trade on Friday its share had slipped 2.5%. They had still risen by more than 11% on a one-year basis.-FIN24 Volvo SA confirms dealership network is 'under review'Swedish automaker Volvo Cars South Africa (VCSA) has announced plans to conduct a "review" of its local dealership network, raising concerns about the possibility of permanent dealership closures and potential job losses. Chinese car group Zhejiang Geely Holding is the majority owner of the car brand, having bought it from Ford in 2010. Other brands in the Geely group include Lotus, Geely Auto, Lynk & Co, Zeekr, and Polestar. VCSA is, however, not part of the Volvo Group Southern Africa, which includes Volvo Trucks or Volvo Bus. In a statement to News24 this week, a spokesperson for VCSA said while the plan has not been finalised, it "has been actively consulting with its independent licensed dealers. Any dealers affected by the review will independently evaluate their operational position and commercial strategy."VCSA remains committed to a transparent and fair process in all its discussions with independent dealers," they added.-FIN24 'All hands to the pump': De Beers seen as the last nut to crack in Anglo's restructuringAs Anglo American rapidly progresses its restructuring, with two sales deals and one demerger now well on track, De Beers has emerged as the final and most challenging asset disposal.The embattled diamond division is having a hard time amid low demand, market oversupply, and the rise of lab-grown gems. These persistent headwinds moved Anglo to write down De Beers by $2.9 billion (about R54 billion) in the 2024 financial year, as noted in the group's annual results published on Thursday."The diamond markets have been really, really difficult for the company. And as a result of that, it's likely to be the last of the four major separations that we're doing," Anglo American CEO, Duncan Wanblad said during a media call, adding: "To the extent that it's this year, it will be very much at the back end of this year. But it's all hands to the pump in terms of getting it done as soon as is reasonably possible."Anglo said it is committed to setting up De Beers in the best possible position to implement its standalone strategy "with an exit for value".Persistently high midstream inventory levels and a prolonged period of depressed consumer demand in China resulted in rough diamond sales falling sharply in the second half of the year.Consequently, Anglo reconfigured production and removed six million carats in response to these conditions last year and plans to remove another 10 million carats in 2025.Although De Beers is now deemed to have a recoverable value of $4.1 billion, Wanblad said there's no correlation between the write-down and Anglo's perception of what a buyer is going to pay for the business. The divestment process is now on a "dual track," in which Anglo is doing work for both a potential sale and a potential demerger and listing of the company.-FIN24 Weaker Panado, Bioplus sales in spaza shops hit Adcock profitWeaker demand for Bioplus and Panado among low-income customers has hit Adcock Ingram, contributing to a 13% decline in its half-year headline earnings. Shares in the pharmaceutical manufacturer, which also owns brands like Compral and Corenza, fell by 5% after the group reported its results for the six months to end-December. It cut its interim dividend to 115c per share, from 125c a year ago. Revenue fell almost 1% to R4.7 billion, with its operating profit plunging 17% to R487.3 million. Profit margins were under pressure as production levels fell sharply, particularly at its Wadeville facility in Gauteng. This was due to lower demand from some pharmaceutical wholesalers, who reduced their inventory of key branded and generic products.The group said consumers remain constrained, particularly in the lower living standards measure (LSM) segment. CEO Andy Hall told News24 that informal traders and spaza shops, which sell to these households, form a big part of Adcock's business. The group's independent wholesale business mainly serviced the informal sector. Hall said that Adcock offers among the cheapest medicines in SA, with many of its products sold in small pack sizes. For example, customers could buy a pack of two Panado tablets along with individual Bioplus sachets.Sibanye narrows loss as gold price rally helps boost incomeSibanye Stillwater last week Friday said its loss narrowed to $311 million in 2024 as income from higher gold prices partially offset the impact of persistently low platinum group metal prices.The Johannesburg-based precious metals producer suffered a $2 billion loss in 2023, taking a knock from falling palladium prices.Sibanye recorded a further $500 million writedown of its United States palladium assets, citing lower palladium price forecasts. It reported $2.6 billion impairments in 2023.Income from the diversified miner's South African gold mines increased 66% to 5.8 billion rand ($315.96 million) compared to the previous year, driven by elevated gold prices."These mature mines, buoyed by the tailwind of a strong gold price, delivered materially better financial results for 2024, during a challenging period for most of our other metals, which are more aligned with industrial economic cycles," Sibanye said.-REUTERS

Company News in Brief

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